Gold Price - Where is it heading?

[finicky]

Gorgeous

 

[ducati916]

Last week, we discussed what a great time it is to be a Gold Bug. For the first time in history, the yellow metal has closed higher for eight consecutive months. Seven in a row happened once, six a few times, but never eight. This is happening right as Gold is decisively resolving a multi-month consolidation, making a fresh leg higher. Will September mark the ninth consecutive month? We think there's a good chance! At the same time, the iShares Global Gold Miners ETF $RING is breaking out to new all-time highs. That’s the generals leading the charge, and now we’re watching that strength cascade down the risk curve. This week’s charts drive home the point. The precious metal miners trade is only getting stronger. Take a look at this sea of green: ​ Our precious metals watchlist is dominated by green, with nearly every stock hitting new highs across multiple timeframes. In the summary below, you can see that 69% of names are making new 4-week highs, 59% are making new 13-week highs, 59% are making new 52-week highs, and 14% are hitting new all-time highs. On the flip side, there are no new lows. Some of the moves are nothing short of incredible. Gold Resource Corp $GORO, is almost 400% above its 52-week low. That’s the kind of extreme upside we’re seeing right now across the board. This is what a healthy bull market looks like.

Early this year, it was noted in this Substack that while 75% of London silver vault holdings are bars for Exchange Traded Funds (ETFs), of the remaining 25% (the ‘float’) vaulted in London only a small portion appeared to be actually available to market (the ‘free float’).

The basis for this statement was that while approximately 200 million (M) silver oz. of silver vault float (ex. ETFs) remained in London at the end of February 2025, the implied lease rate was surging to very high levels indicating an intensifying silver market shortage.

Only A Small Portion Of London’s Silver Vault Float Is Free Float Available to Market​

Since late in the spring of 2025 two things can be noted regarding the latest London vault holdings of silver shown in Figure 1 below:

1. Almost all of the increase in London vault holdings of silver have been silver ETF holdings that are theoretically not available to market. (While Jeff Currie, Goldman Sachs’ Global Head of Commodities Research at that time, did tell us in November 2021 that silver ETFs purchased silver then immediately sold claims against their clients’ silver into the market suppressing silver market demand and silver prices, it is likely that this illegal practice has been curtailed given the widespread attention that it garnered in the silver investment community.)
2. 
   
3. The London vault silver float has been relatively constant at 140M oz. or 4,341 tonnes (see red lines in Figure 1) since late spring 2025 while now even the 1-year lease rate for silver has surged above 5% signifying an intense silver supply shortage in London. The constancy of the level of the vault silver float while silver prices and now even the the 1-year silver lease rate (Figure 2) has surged indicates that large part of this silver float is privately held and merely located in London vaults - there appears to be very little liquid silver in London available to market.

​

Figure 1 - London Vault Silver Holdings; source: LBMA, GoldChartsRUs.com

​

Figure 2 - London Implied Silver Lease Rate (1-Year Lease Term); source: Bloomberg

In 2021, the LBMA started publishing daily average London gross turnover data for gold and silver trading in a quarterly newsletter called the LBMA Precious Metals Market Report although these reports give data on daily gross turnover in some cases at a mere 15% relative to their monthly published ‘net settled’ data in comparison to that which they previously reported. It is difficult to know what to believe. Without an explanation from the LBMA, it smells a bit gamey.

Be that as it may, the LBMA’s Q1 2025 data indicate that ~ 600M oz. of silver were traded each day in London implying promissory note contract claims for between 1 billion (B) oz. and 2B oz. of silver in the London silver market. Assuming the data are correct.
If the 140M oz. London silver float is, as it appears, closely held and not available to market (i.e. a London free float near zero), there is a serious silver liquidity problem brewing in London.
To date, silver appears to have been imported into London to meet ETF demand. Where is the silver going to come from to meet the continued growing silver investment demand and billions of oz. of standing market claims in London that is the world’s largest physical gold and silver market?

So How Much Silver Is Available As a ‘Free Float’​

The global silver supply deficit was initially estimated at 200M oz. for 2025. Then New York vault stocks of silver increased by 200M oz. early in 2025 and have now stabilized at higher levels. Given current circumstances, that silver is not going back to London.

Rising London silver lease rates accompanied by a very rapidly rising price for silver, largely static silver vault holdings in New York and a static London float are important signals. And if there is word of silver delivery default in the London market that signal will quickly lead to other demands for delivery against standing contracts unwinding the entire leveraged London silver market.

Also remember also that silver is a Giffen Good meaning that price rises initially draw added demand to the market before shortage is resolved.

In the face of all this, the market is telling us that there is very, very little liquid silver supply in the form of a free float - much of the global silver production is forward bought by industrial users and added investment demand is increasingly revealing to the world how tight this market is.

Given the tension visible in the silver market right now (prices and lease rates), silver bars of the correct form that are truly liquid and available in the London and New York markets for delivery may be measured in the 10s of millions and not in 100s of millions of oz.

Nobody truly knows the exact number but either way, market action says we are soon going to find out.







jog on
duc

 

[Garpal Gumnut]

I think it would be safe to call the chart of gold over the last 3 days as being " indecision ". It will be interesting to see where New York takes it tonight after the close of our markets. Crazy fundamentals atm. I still see no signs of gold falling. Taps head.




gg

 

[ducati916]

So the gold secular bull market is half way through inning one. Eight and a half innings to go.




So who is this chap?

This chap is the CEO of TETHER. LOL.

Tether are going to buy gold miners.




Tether, the world’s biggest stablecoin company, has held talks about investing in gold mining, seeking to deploy its vast crypto profits into bullion. The company has held discussions with mining and investment groups about investing in the entire gold supply chain, from mining and refining to trading and royalty companies, according to four people familiar with the recent talks.

While gold has been a physical store of value for thousands of years and bitcoin has only existed as a digital instrument since 2009, there is a growing affinity between some industry executives. Tether chief executive Paolo Ardoino has likened gold to “natural bitcoin”. “I know people think that bitcoin is ‘digital gold’,” he said in a speech in May. “I prefer to think in bitcoin terms — I think gold is our source of nature.”

One of the world’s most profitable crypto companies, Tether runs the USDT token, which is pegged to the US dollar and has a market capitalisation of $168bn, and generated profits of $5.7bn in the first half of this year.

Tether is also one of the biggest holders of US Treasuries, making its money from the interest it earns on the bills it holds to back the token — the world’s most traded cryptocurrency. Ardoino is a big advocate of gold and has previously said the metal should be a safer asset than any sovereign currency, and can be a complement to bitcoin.

Tether has already amassed a significant position in bullion — with $8.7bn of gold bars in a Zurich vault, according to financial statements, which it uses as collateral for its stablecoin. In June Tether Investments, which is in charge of investing the company’s profits, paid $105mn for a minority stake in a gold royalty company, Toronto-listed Elemental Altus.









Propaganda?

I don't think so.

Now the Russians know what is actually going on. Putin and his advisors have been absolutely spot on for a very long time. They after all make it their business to spy on their enemies.

Fact: the US debt is a massive problem for the US.
Fact: the US MUST devalue or retire a significant portion of their debt to survive.

Theory: is this a plausible or possible way to accomplish that requirement.

Fact: yes.


Conclusion: gold is going MUCH HIGHER.

I wouldn't even bother with the charts until about $24,000oz. LOL.


jog on
duc

 

[Garpal Gumnut]

Thanks @ducati916 . I've been following the Tether news and wonder whether the recent rise in price escaping the Chinese cousins $3333.33 level was not due to that. It now sits at $3641.40 over the weekend. There does seem to be a very constricted trading range atm. and one wonders whether the present discord in the US will be sufficient to push gold higher.

Worst case scenario is a drop to support at the six threes ($3333.33). To me it looks like a dart pick as to whether it will go higher atm. The tolerance for US and international mayhem with C. Kirk's demise, Russia attacking Poland and Middle East wars seems to be quite high. I guess if I had to make a pick I'd say going higher but those recent prices on the charts are sticking together. Yes one would have to think gold will go higher.



gg

 

[Sean K]

Thanks @ducati916 . I've been following the Tether news and wonder whether the recent rise in price escaping the Chinese cousins $3333.33 level was not due to that. It now sits at $3641.40 over the weekend. There does seem to be a very constricted trading range atm. and one wonders whether the present discord in the US will be sufficient to push gold higher.

Worst case scenario is a drop to support at the six threes ($3333.33). To me it looks like a dart pick as to whether it will go higher atm. The tolerance for US and international mayhem with C. Kirk's demise, Russia attacking Poland and Middle East wars seems to be quite high. I guess if I had to make a pick I'd say going higher but those recent prices on the charts are sticking together. Yes one would have to think gold will go higher.

View attachment 208448

gg

There could be a 'sell the news' event next week with a confirmed .25 drop in the US but it might depend on the language and prospect of further drops. Market seems to have factored in further drops, so maybe a slight correction possible.

Russia is playing with fire with the 'errant' drones crossing into Poland. I think it was a deliberate move to test Poland and NATO to see how far they can go before retaliation. The geopolitical risk hasn't improved, maybe worse, supporting POG.

Potential short term blip, but I reckon it will be bought up very quickly by the CBs.

And, I think Main Street has only just got a notion of the PM trade even though they're up 100% in a couple of years.

 

[qldfrog]

China proposes rule changes to ease gold imports and exports

The latest development builds on the PBOCs initiative to simplify procedures for cross-border trade in gold by reducing paperwork and speeding up imports.

m.economictimes.com

Of relevance I think

 

[mullokintyre]

BTL has been posting this chart weekly for some time now.
Gold has been trading in a band for months , just like it did between mid September last year and mid january this year.
It also tarded in a narrow range for most o2024.
In each case, once it has broken out of the trading range, it has shot up to new heights.
BTL is epecting that behaviour to continue.
Some gold stocks are down over 5% today.
I have taken some of my stored cash and further invested in TRE, TCG, back into STN and AUC.
All have fallen today for no particular reason, so happy to keep loading up.
WIll be looking to see which gold stocks, if any, get hit on the TSX and NYSE tonight.
Mick

 

[finicky]

I anticipate the day that Albo and Chalmers belligerently front the press and heroically demand that the Australian people deserve their fair share of the gold mining companies' super profits. How can they resist emulating such luminous thought leaders as Kev Rudd/Swan and the Africa juntas. Lots of spending on energy transition, women/gays/indigenous empowerment, 'The Light on the Hill', and upgrading the defence forces to be funded.

 

[rcw1]

Good afternoon
wow ... tis trying real hard to break on through to that other side of US $3600 ... how exciting

Yeah!!

View attachment 208009View attachment 208010

Kind regards
rcw1

Gold is good ...
US$3700 soon ... just blink

Kind regards
rcw1

 

[ducati916]

We’re coming to you from Toronto this week for the Portfolio Accelerator event - the unofficial Gold Bug capital of the world. Just a two-minute walk from our hotel is Agnico Eagle Mines’ headquarters, a fitting reminder that this city is home to Canada’s largest Gold miner and the second-largest in the world. If you want a pulse on the gold space, you couldn’t pick a better neighborhood. Right now, the moods are good around here... Gold miners are benefiting directly from the surge in precious metal prices. With Gold prices rising and Silver following suit, miners are seeing their leverage to metals pay off in real time. When the underlying commodity price rises, best-in-class operators like Agnico stand to benefit the most. The charts tell the story best:

​

After decades of carving out an accumulation pattern, Agnico Eagle Mines broke out to new all-time highs earlier this year. This is the type of structural breakout technicians wait for over entire cycles. Once these kinds of bases resolve, they tend to fuel powerful, sustained advances. That's exactly what we've seen... The stock has rallied for eight consecutive months, and it appears that September will make it nine months in a row. On a relative basis, AEM is on the cusp of resolving a massive base relative to the shiny yellow metal. New highs in the relative trend would confirm the new highs in the absolute trend. Agnico Eagle Mines is high and tight:

​

On the daily chart, the story is just as bullish. A few weeks back, Agnico Eagle Mines was rewarded for a double beat, ending a four-quarter streak of negative post-earnings reactions. That fundamental catalyst was the spark that launched the breakout. Since then, the stock has continued to move steadily higher. Now price action has tightened up into a high-and-tight continuation pattern, one of the most bullish consolidations we look for. That setup suggests another leg higher could be imminent. In other words, investors are getting a tactical entry point that aligns perfectly with a long-term breakout and a strong intermediate-term uptrend. It doesn’t get much cleaner than that. So here we are, standing in the Gold Bug capital, watching Canada’s largest miner print fresh all-time highs. Up here, it's clear that we're in a global Gold Rush. Happy fishing

jog on
duc

 

[ducati916]

• Precious metals are just getting started.
• Portfolio managers are playing catch-up.
• We're adding to our mining exposure.

Gold mining stocks have doubled this year.

This year. Already twice the value they had when they ended 2024.

In fact, the Philadelphia Gold & Silver Index (XAU) is on pace for its greatest year ever.

It's All of Them​

Here's a chart of the performance of Gold Mining Stocks (GDX), Junior Gold Mining Stocks (GDXJ), Silver Mining Stocks (SIL) and Junior Silver Mining Stocks (SILJ) - all up triple digits this year:



I've been doing this a long time.

I was even a Gold Bug 20 years ago, although it turns out I was just a trend follower.

I've never seen performance like this from the group - across the board.

They Don't Own Enough​

Here's the latest allocation breakdown published by the BofA Global Fund Manager Survey:



You can see that almost 40% of fund managers don't have any Gold at all.

Only 6% of fund managers are holding more than 8% of their portfolios in Gold, which is less than it was the month before.

What are they waiting for?

Based on the performance of Gold and the mining stocks, I would have expected to see a higher allocation among fund managers.

But we're not.

There's still plenty for them to buy, which should provide further tailwinds for the price of the metal and the stocks.

Big Base in Silver​

When you zoom out in the price of Silver, you'll find one of the longest periods of accumulation in any market on Earth.

I challenge you to find me a bigger base.

Look at this thing:



The performance we've seen in precious metals this year looks like just the beginning.

I'm not betting that this is over just yet.

We've been allocating assets to these companies this year, and we'll continue to add to them.

From my perspective, these stocks underperformed for so long that most investors completely forgot about them.

I think they're wrong.

And now the chase is on.

Stay sharp,


jog on
duc

 

[mullokintyre]

In the aftermath of the Fed reduction in interest rates by 25BPS, gold immediately dropped over 40 bucks.
This seems counterintuitve.
i you are going to get less interest income for your holding cash, tone might expect that other assets would go up.
Especially as the fed forecasted two more 25BPS interest rate drops this year.
The AUD/USD pair as hardly changed.
The US indeces were mixed - NASDAQ down, S&P down, the dow up.
It highlights how in times of trouble, the so called flight to quality of the USzd can cut down pretty much every asset class.
If there is a market crash, everything, including gold and gold stocks will go down with it, but eventually will recover as it will be seen by those outside the US as a better option.
Mick

 

[Sean K]

In the aftermath of the Fed reduction in interest rates by 25BPS, gold immediately dropped over 40 bucks.
This seems counterintuitve.
i you are going to get less interest income for your holding cash, tone might expect that other assets would go up.
Especially as the fed forecasted two more 25BPS interest rate drops this year.
The AUD/USD pair as hardly changed.
The US indeces were mixed - NASDAQ down, S&P down, the dow up.
It highlights how in times of trouble, the so called flight to quality of the USzd can cut down pretty much every asset class.
If there is a market crash, everything, including gold and gold stocks will go down with it, but eventually will recover as it will be seen by those outside the US as a better option.
Mick

A 'sell the news', Mick. 25 bps was well factored in. Maybe if more governors had voted for a 50 bps cut the market might have been more excited about the next meeting pumping out another cut and factoring that in. A 50 bps cut now would have been a surprise and gold might have jumped 40 bucks. At the moment, the data seems to be relatively steady and doesn't support another cut so we'll have to wait. I think the market will also start to factor in Powell being replaced with a Trump patsy next year who will cut baby cut.

 

[mullokintyre]

A 'sell the news', Mick. 25 bps was well factored in. Maybe if more governors had voted for a 50 bps cut the market might have been more excited about the next meeting pumping out another cut and factoring that in. A 50 bps cut now would have been a surprise and gold might have jumped 40 bucks. At the moment, the data seems to be relatively steady and doesn't support another cut so we'll have to wait. I think the market will also start to factor in Powell being replaced with a Trump patsy next year who will cut baby cut.

A 50BPS cut now has the same result as two 25BPS cuts before the end of the year.
Its the optics.
If Powell is replaced by a Trump Patsy next year, I am not sure how much it will affect the rate decisions.
The FOMC consists of 12 member votes, seven of whom come from the board of governors, and five from the reserve bank presidents.
The president congress selects the seven board of governors, but the other five are done by vice presidents of the other junior fed banks.
Trump will probably have to replace more governors to get someone more compliant perhaps.
Mick

 

[Garpal Gumnut]

In the aftermath of the Fed reduction in interest rates by 25BPS, gold immediately dropped over 40 bucks.
This seems counterintuitve.
i you are going to get less interest income for your holding cash, tone might expect that other assets would go up.
Especially as the fed forecasted two more 25BPS interest rate drops this year.
The AUD/USD pair as hardly changed.
The US indeces were mixed - NASDAQ down, S&P down, the dow up.
It highlights how in times of trouble, the so called flight to quality of the USzd can cut down pretty much every asset class.
If there is a market crash, everything, including gold and gold stocks will go down with it, but eventually will recover as it will be seen by those outside the US as a better option.
Mick

I think gold was due for a small retracement. Like every other asset in these fraught times it will behave counter-intuitively from time to time. It wouldn't surprise me as I believe I said in another post for gold to fall towards but not as far as the dreaded $3333.33 before moving up again. I cannot see $4000 being much of a barrier.

So in summary a fair amount of volatility between low $3700's and low $3400's, then resistance beyond $3800 to fail and gold to continue up to low $4100 or $4200's.

Much of that opinion was from charts of different time scales and I couldn't find the link before writing this post.

Gold is good. If everything goes to crap you can exchange it for food, water, sex and a roof over your head.

gg

 

[finicky]

Gold is good. ... you can exchange it for sex and a roof ..

It's a wonder you have any gold left

 

[ducati916]

Gold has surged this year, and now is up more than 40% year over year. You'd have to go back to 1979 to find a year in which gold rallied this strongly by mid-September. Back then, it tacked on almost another 50% by year-end.
The chart below shows gold since 2005, with the orange markers indicating times when gold was up at least 40% over the previous 12 months. Those past occurrences don’t look like the best of times for gold. In this article, I’ll quantify gold returns based on its performance over the past year. This could give us insight into the likelihood of this momentum continuing.

IS GOLD'S RALLY SUSTAINABLE?​

The table below shows gold’s one-month performance based on its return over the previous 52 weeks, with the data going back to 1980. Right now, gold is up 40% year-over-year, placing us in the bottom row of the table. Historically, the stronger gold’s 12-month gains, the better its next month returns tended to be – up to a point. Once the prior year’s return hit 40%, the trend reversed, suggesting gold may be overextended. In those cases, the metal averaged a 1.22% loss over the next month, with only 45% of returns positive. Gold outperformed the S&P 500 Index (SPX) just 35% of the time.

Using the same data, these next two tables summarize longer-term returns for gold. Gold bugs who made money over the past year may want to shift those profits over to stocks. With gold up 40% year-over-year, it has tended to lose 2.18% over the next six months, with 42% of the returns positive and only 29% of them beating the SPX. Over the next year after these huge run-ups, gold declined by over double-digits on average (-11.23%) with just 30% of the returns positive and 20% of them beating stocks.

This last table shows all years in which gold was up at least 20% as of mid-September, along with subsequent returns. I mentioned earlier how in 1979 gold was up even more than this year, and added almost 50% more by the end of the year. That was just one instance, however, and gold has typically been terrible for the remainder of the year after huge gains through mid-September. Excluding 1979, the metal averaged a 7% loss for the remainder of the year, with just one of six returns positive, and that one positive return was just a 1% gain.

History doesn’t guarantee what comes next, but based on the data presented here, gold seems stretched with decreased odds of further gains.







Full:https://www.deshaw.com/library/worth-its-weight


jog on
duc